Cathay, Hactl show depressed February results

Monday, March 18, 2013

Cathay Pacific Airways and its subsidiary Dragonair carried 103,752 tons of mail in February, a 12 percent, year-over-year decline despite an 8.3-percent reduction in capacity.
The load factor decreased to 61.1 percent, and revenue fell by 14.9 percent.
James Woodrow, the carrier’s general manager for cargo sales and marketing, blamed the sluggish numbers to poor performance in trade from Europe and North America. The Chinese New Year didn’t help matters, either.
“There was no pre-Chinese New Year rush to speak of out of mainland China and Hong Kong, and what demand there was in the market fell away as China’s factories closed,” he said in a statement. “The pick-up following Chinese New Year was slower than expected.”
Cargo and mail carried during the first two months of the year actually represented a 1-percent increase over the same time period last year, though revenue declined by 3.6 percent using the same comparison. The combined January and February load factor was only off by 0.5 points when compared to January and February 2012.
While cargo activity fell, generally, for the carrier, passenger volume rose in February.
Last month brought a big, long-anticipated change for how Cathay’s cargo arm does business. The carrier recently unveiled a new $760 million cargo terminal at its base at Hong Kong International Airport. The change might not have that much impact on cargo activity at the airport, which saw overall airport cargo volume fall by 13.3 percent, year over year in February. The airport finished the month at 248,000 tons, which is a bit deceiving due to the Chinese New Year. Taking into account January and February, the airport experienced 582,000 tons, a 3.6 percent, year-over-year increase.
HKIA officials attributed the increase in cargo to a rise in transshipment activity; cargo's February numbers were impacted by holiday factory closures.
"We expect that cargo will gradually stabilize in the coming months as
factories resume operations and we remain cautiously optimistic for the
cargo growth in longer run," Stanley Hui Hon-chung, the airport authority's chief executive officer, said in a statement.
A plan to build a third runway at HKIA will also have a lasting impact on cargo activity in the future.
The main cargo handler at HKIA, Hong Kong Terminals Ltd., may end up losing out with all the recent developments. HKIA used to count Cathay as its largest customer, and while its activity numbers haven't yet shown the full impact of the departure of the carrier, they will soon. According to provisional results, Hactl’s February numbers showed 39 percent of its import traffic comes from Southeast Asia, with 16.77 million kilos. North American imports ranked third in terms of activity, behind Europe, with 6.7 million kilos during the month. In all, Hactl handled 42.7 million kilos in February.
On the export side, Europe finished first for the month at 22.15 million kilos. North America was second at 20.1 million kilos, representing more than 26 percent of Cathay’s 76.87 million kilos of activity.
Import totals at Hactl fell by 21.73 percent compared to January, while exports fell by 33.48 percent. Year over year, imports and export totals fell by 13.3 percent and 18.72 percent, respectively. For the full year, the results for the first two months of 2013 are up on 2012’s two-month results. Imports grew by 2.65 percent, while exports had bumped up by 0.37 percent. These increases are fueled by activity in Africa and the Southwest Pacific. - Jon Ross